Public Revenue and Public Expenditure as Predictors of Economic Growth: The Case of BRICS Countries

Public revenue and public expenditure represent essential components for economic progress and prosperity. The optimal balance between public revenue and public expenditure could have positive and lucrative implications for economic growth. This paper aims to highlight the interaction between these components analyzing their relationship in the short- and long-run. The subject of the research implies the nexus between public revenue, public expenditure and economic growth in BRICS countries from 2006 to 2023. We applied static and dynamic panel models to provide a detailed analysis of potential indications of public revenue and public expenditure on economic growth. The obtained findings point out that public revenue and public expenditure significantly affect economic growth, with the greatest impact registered in China and India. The contribution of the research implies new specific insights and perspectives for policymakers in BRICS from the aspect of identifying optimal fiscal policy, as well as making decisions related to revenue-expenditure components and their implications on economic growth.